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Chinese Import Competition, Offshoring and Servitization

Author

Listed:
  • Gu, Grace

    (University of California Santa Cruz)

  • Malik, Samreen

    (New York University AD)

  • Pozzoli, Dario

    (Department of Economics, Copenhagen Business School)

  • Rocha, Vera

    (Department of Strategy and Innovation, Copenhagen Business School)

Abstract

This paper examines whether Chinese import competition increases the propensity for firms to offshore production or to cease any involvement in production by switching completely and permanently out of the manufacturing sector (servitization). Using a Danish employer-employee matched dataset covering a large sample of manufacturing firms over the 1995-2012 period, we find that import competition from China significantly increases offshoring but does not induce servitization. These findings are confirmed using various robustness tests as well as an analogous analysis of a Portuguese employer-employee matched dataset.

Suggested Citation

  • Gu, Grace & Malik, Samreen & Pozzoli, Dario & Rocha, Vera, 2021. "Chinese Import Competition, Offshoring and Servitization," Working Papers 5-2021, Copenhagen Business School, Department of Economics.
  • Handle: RePEc:hhs:cbsnow:2021_005
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    Cited by:

    1. Zhang, Junnan & Sun, Xiaohua & Yuan, Fang & Liu, Xiaoling, 2023. "Which type of servitization promotes firm performance: Embedded or hybrid?," Economic Modelling, Elsevier, vol. 126(C).

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    More about this item

    Keywords

    Foreign competition; Offshoring; Servitization;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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